Banque Du Liban Interim Governor: August Salary to be Paid in Dollars
(AWP) - Acting Governor of Banque du Liban (BdL) Wassim Mansouri said on Friday that public-sector employees’ salaries for August will be paid in U.S. dollars, noting, however, that the bank cannot confirm if this is going to be “permanent.”
In a press conference at the BdL headquarters in Beirut, Mansouri said the bank will not lend to the government to cut the state budget deficit.
He pointed out that the public-sector employees’ salaries will be paid based on an exchange rate of 85,500 Lebanese liras per U.S. dollar.
“The priorities mentioned are determined by the government and the capabilities of BdL to help transfer money into foreign currency, which only covers a limited portion of the mentioned ministries. However, this might not be feasible next month. Even if it was secured for the coming month, this same might not be the case with the month after that. These are conventional monetary solutions, but sustainability is not inherent in what we are doing today,” said Mansouri.
The acting governor of Lebanon’s central bank warned that the monetary conditions in the country “cannot tolerate any procrastination,” asserting that monetary stability is a priority and must be protected by all traditional monetary means.
“The monetary stability secured by BdL is linked to economic and security conditions. The bank can‘t maintain this stability without the cooperation of the parliament and government,” he explained.
Speaking on the foreign currency reserves, Mansouri said they will not be touched, adding “any measures to be taken will be outside of these reserves.” He noted that an agreement was reached to secure the needs of the army and the security agencies without affecting the country’s foreign currency reserves.
“The problem is that these needs are also present within the ministries and all state institutions but these sums cannot be provided all at once despite the ministries’ urgent needs,” he said.
Mansouri appealed to all political and parliamentary powers to remove the monetary authority and its needs from any political tugs-of-war.
He also warned of the danger of having Lebanon isolated from the global financial system, which would pose a significant threat to the economy, people’s lives and the future of the banking sector.
“I must ring an alarm bell to warn of the current stagnation in the adoption of reform laws which will undermine sound and sustainable economic stability and will expose Lebanon to the risks of isolation from the global financial system. This has a significant impact on the economy, citizens’ lives and the future of the banking sector,” he warned.